Asian bourses end brutal week on technical bounce

UNCERTAIN PICTURE Concerns mounted that a three-year bull run may have come to an end, but the region's bourses ended mostly higher on Friday

AFP , HONG KONG

Asian stocks were mostly higher on Friday, after a steadier performance on Wall Street provided some relief for investors whose nerves have been sorely tested after another round of dizzying losses.

Dealers said the bounce was technical in nature and while the respite was welcomed, few were prepared to bet that the massive sell-offs, which have dominated trade since the middle of last month, had come to an end.

A White House forecast predicting a growth rate of 3.6 percent for the US economy this year eased concerns about a slowdown or even a recession and lifted Wall Street from the doldrums, giving markets in Asia a boost too.

But concerns that higher interest rates will accompany slowing economic growth -- the worst possible combination for equities -- persisted, and volumes were thin and gains less than convincing.

Many fear that unlike other sharp corrections of recent years this massive correction could signal the end of a three-year bull run, with higher interest rates expected to wind-down a consumption boom fuelled by debt.

Such feelings were evident in Manila where shares closed flat, with Shanghai down 2.49 percent and Wellington off 0.77 percent.

Elsewhere, Mumbai continued its rollercoaster ride with a 5.54 percent gain, Jakarta was up 2.69 percent, Singapore 1.75 percent higher while Bangkok and Kuala Lumpur were down 0.77 and 0.20 percent respectively.

taipei

Share prices closed 1.78 percent higher on a technical rebound as investors set aside domestic and external concerns and hunted for bargains in a market that had been badly battered over the past sessions.

Dealers said the prospect of a sustainable rise, however, remains doubtful due to continuing concerns over the prospect of further US rate hikes and opposition attempts to oust President Chen Shui-bian (陳水扁) amid alleged corruption scandals implicating his family and top aides.

The weighted index closed up 112.82 points at 6,444.63 on turnover of NT$118.61 billion (US$3.65 billion).

"It's purely technical ... the steeper the previous declines, the more dramatic the rebound," said Oliver Fang, a Yuanta Core Pacific Securities assistant vice president who serves mainly foreign investors.

"It's too early to say if we are already out of the woods yet," he said. "All the uncertainties that had triggered the recent downturn remain firmly in place."

Acer rose 1.80 to 53.00.

tokyo

Share prices broke a four-day loosing streak after a jump in domestic machinery orders provided much-needed relief to investors sweating over US inflation.

The Nikkei-225 index rose 117.81 points or 0.81 percent to 14,750.84, a day after slumping below 15,000 points for the first time in six months on worries about higher US interest rates.

Volume reached 3.17 billion shares, up from 2.65 billion on Thursday.

Stocks managed to eke out gains by the close after a dismal week during which the Nikkei lost 6.6 percent of its value and the TOPIX 6.7 percent.

Stocks swung in and out of negative territory until winning a boost from the machinery orders data, a leading indicator of corporate capital investment which come in stronger than expected.